XVS is currently trading inside a larger descending channel, meaning the higher timeframe structure is still technically bearish. However, on the 2H chart price has formed a short term ascending structure, printing higher lows and slowly pushing into the upper boundary of the channel.
This creates a clear decision zone.
Price is now compressing between the rising trendline support and the major descending resistance trendline above. When you see this kind of tightening structure near resistance, it usually signals expansion is coming soon.
If buyers manage to break and close above the descending trendline with strength, that would shift short term momentum bullish. In that case, the next upside targets sit around 3.35 first, and if continuation follows, 4.08 becomes a realistic extension level.
However, if price rejects from this resistance area and loses the ascending support trendline, it opens room for a deeper pullback. The first downside target would be around 2.87, and below that the broader channel support near 2.49 becomes the key liquidity zone.
So this is not a random area.
This is a compression zone inside a macro downtrend.
Break up equals momentum shift.
Break down equals continuation of the larger bearish structure.